News Release: Pension audit goes beyond the 'politically palatable'

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For Immediate Release: Tuesday, August 29, 2017

(FRANKFORT, Ky.) — The presentation of the final phase of an audit of Kentucky’s public pension plans at Monday's meeting of the Public Pension Oversight Board confirms what the Bluegrass Institute has said all along: changes in the way benefits are awarded must occur immediately.

“For years and even decades, Frankfort has distracted citizens and taxpayers from the real problem of an imbalanced system with unsustainable, arbitrary benefits with charges of inadequate funding and insufficient returns on invested funds,” Bluegrass Institute president and CEO Jim Waters said today in a statement responding to the much-anticipated release of the final phase of PFM’s audit.

“Any responsible evaluation of funding and returns must acknowledge that funding has been far beyond expectations and investment returns have been healthy and exceeded assumed rates in many of the past 30 years, which is the only proper way to view these issues in a defined benefit pension system like Kentucky’s,” Waters said.

He commended Gov. Matt Bevin and legislative leaders for being willing to open the door to a serious discussion about retirement benefits, which often has been considered the third rail of politics.

“It appears that with today’s presentation, we at least are moving beyond a limited view of what’s simply politically palatable in discussions about the commonwealth’s pension crisis – arguably the nation’s most severe – toward meaningful changes that consider how the state can provide benefits to its workers without threatening Kentucky’s entire economy,” Waters said.

The Bluegrass Institute Pension Reform Team has been presenting “Sound Solutions for Kentucky’s Pension Crisis,” its description of – and solution to – this fiscal nightmare to groups and policymakers statewide.

While the Bluegrass Institute will review PFM’s recommendations in the days ahead, rest assured that big-government types will try and take advantage of this opportunity to target hard-working Kentuckians with tax increases while fighting any proposal for change.

“The status quo is simply unacceptable, unsustainable and unfair to future generations of Kentucky who will bear the brunt of debt and lack of opportunity if we fail to reform the structure of benefits and start to make real progress in reducing our unfunded liability,” Waters said.

The Bluegrass Institute stands ready to work with any and all policymakers who want to bring substantial and meaningful reform to Kentucky’s pension system.

For more information or comment, please contact Jim Waters at jwaters@freedomkentucky.com, 859.444.5630 ext. 102 (office) or 270.320.4376 (cell).